It’s been a pretty slow week so far with decent moves in the first hour or two and then absolutely nothing to trade after 11 am. Market having some hesitation about moving out of the top of the range, but I think it takes a shot at 282 soon, if for nothing else than to grab the stops that have built up there.

SPY – Basically a dollar range on Tuesday from 279-280, just consolidating for a breakout attempt. Not a bad run though considering we closed last week at 274.49. The important levels on the downside today are 278.85 (YLow), 277.72 (8day ma) and 277.61 (20day ma). On the upside 280.07 (YHi) and 281.87.

Oil – Watching for a breakout of the 58 level. API on Tuesday afternoon was a 2.6 million draw, so maybe looking at a decent EIA number at 10:30ET.

XLE – Tuesday was a bit of a reversal from what has been happening over the last couple of weeks as the XLE (+.7%) was weaker than the XOP (+2.6%). This is almost solely due to XOM (+.3%) and CVX (+.2%) being neutral. The big spot for XLE today is the 8 day ma sitting at 65.37, which is also YVWAP. Market could rotate around that for much of the day. On the upside, the levels come in at 65.52 and 65.65. On the downside, 65.00. I’m optimistic on energy today and if this can break yesterday’s high, there is room to the 66.50 area. I’m not interested in shorting the XLE up here.

XOP – The XOP has had two very strong days and has run right to the 8 day ma which sits at 29.46. I posted the decision tree for the XOP on Sunday and we are getting very close to where I had the market stalling out into supply. I’m watching the 29.50-30 range for a defined short setup. I think the short opportunity most likely arises just after the EIA number. If I get any spike up into the 30 area, I’ll be starting a short position for a run back down to 28. If the market gets near 31, I think the short idea will likely be proven wrong and we could be looking at an attempted breakout of the 31.50 area. If we get near 31, all my shorting will come to an immediate stop. That weekly Wyckoff accumulation is still nagging me a bit, which is causing me to be very cautious with my short activity. I think we get definite resolution this week on XOP, either we make a run at 31.50 and these E&P’s heal or the whole house of cards comes tumbling down with them.

Top Swing Trade Setups:

EOG – This one is still relatively weak and I’m wondering if there is some bad news coming. I’m watching the 85 level to start a long swing position with a stop around the Christmas lows. The closer entry I can get to those Christmas lows, the better.

COP – This was the weakest stock on my board Tuesday, down about -.4%, which is significant seeing as how the XOP was up +2.6%. I’m watching the 65 level for a possible swing long.

MPC – The refiners were fairly neutral Tuesday, yet MPC was down about -.6%. I’m watching the Christmas low levels around 55 for a possible swing long. PSX might be a better play for refining as their pipeline assets are really attracting positive market action, but the risk reward on it isn’t very good. Take a look at KMI, WMB and ENB to see that the market has been running these midstream assets up nicely.

XOM – This is probably the only individual name that I’m looking at for a short, as my preferred short remains XOP. That 80 level is causing some difficulty and if the SPY turns down, XOM likely follows it. This has been an incredible run from 65 to 80 and it might be time to pull back at least a third of that move, which would take it back to around 75. Keep an eye on RDSA also, it is in a very vulnerable position and could fail at the 62 level.

APA – Most people don’t like APA, but if you look at the chart, it’s still hanging up there around the highs since Christmas. The relative strength is interesting and I’ll keep an eye on this one for one of the first E&P’s that could breakout to the upside.

CDEV – It’s finally getting a bounce after hitting a low of 8.28. Almost everything has gone wrong on this one. Earnings were disappointing, the decline rate issue was very negative and to top it all off they did a $500mm offering on Tuesday. It was an attempt to clean up some near term debt, but still likely a bit negative. Maybe they figured things were so negative that they might as well throw the kitchen sink in there and get it all over with now so this one can heal. I’m in this one from 9.77, so I have a long way to go to get back green. CDEV has been one of my favorites for awhile and I’m willing to give them every benefit of the doubt, but it needs to get going soon.

MGY – This one is consolidating nicely in the 12-12.50 area and could be getting ready for a breakout of the 13 level. It has a very well defined breakout point and could have room to 15 if it gets running.

CLB – Purely a technical breakout play, if this one can get some steam over 69, it could go on a nice run to the mid 70’s.

LLEX – This is a microcap and very risky. They have made some nice progress getting their act cleaned up lately and if this one drops back near $1, I’m going to pick up a position for a longer term hold. Again, this is one of those that is played only with money you can afford to lose.

GLNG – Normally, I hate everything related to shipping, as these businesses are the worst. However, the LNG business is hot lately. Cheniere has been moving well, and TELL (which is a stock I love) and NEXT are starting to get some attention also. GLNG operates the ships that transport LNG. It has formed a nice Wyckoff accumulation pattern and looks to have completed a phase C spring and could be getting ready to move. Watch that 22 level and then the action at 23. If those two levels break, it could run to the upper 20’s.

RIG – This one made a very strong move Tuesday and is trying to breakout to the upside through the $9 level. It stalled at the 8 day ma at 9.12, but if it can get past that, there is room to the 11-12 area. The market has become a bit frustrated with the short cycle, high decline onshore market and money could start shifting back to longer term outlooks. ESV, DO and RDC don’t seem to have as much positive movement right now, so I’m still a bit cautious on offshore.

APVO – One free bonus non-energy microcap. I picked up some of this at .85. I seriously traded microcaps years ago and this one is showing some interesting activity. Feels like some players are positioning here for a big pump and dump in the coming months. The financing with Lincoln Park Capital initially got my attention, as well as the recent offering with the $1.30 warrants. Yesterday afternoon AH, Point 72 (Steve Cohen) announced a 7.3% stake in the company, which just further confirmed my thoughts that something is brewing here. It probably goes mid .90’s today, but should settle back in around .85 for awhile longer. Could be an easy double or more. These are strictly lottery tickets that keep me entertained when energy is slow. Just fun money.

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